Banking Better Online

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By far, the most frequent touch point between financial institutions and their customers today is online – specifically online banking or other logged-in experiences – outpacing branches, call centers, and service representatives combined.

As one stakeholder from a large regional bank told us during a recent project, "If the online channel was a physical branch, we would have to buy the football stadium and fill it with tellers, not just put our name on it!"

Extractable recently evaluated the logged-in online banking (OLB) experiences of 20 of the largest and most recognizable banks in the United States. What we found is that, while many provide their authenticated customers an experience with rich functionality, nearly all fall far short in delivering an easy-to-use and insightful user experience for customers to actually manage their money.

What is most surprising is how similar these shortcomings are across banking brands. In our research, both the typical retail customer and the typical commercial customer are engaged with multiple financial institutions. Tens of millions of people must tolerate multiple OLB experiences, with each coming up short in a similar fashion.

In reviewing these OLB experiences, we found they are by-and-large designed in a way that is "bank-centric" rather than "user-centric." Products, services and transactions are expressed as a financial professional (or their product manager!) might talk about them, not as a nurse, firefighter or teacher would be expected to. Thus, an "inside-out" design approach manifests in which user interactions are structured around a bank's own internal systems and 3rd-party integrations, rather than a user-friendly and informative approach.

An opportunity exists for banks to pivot and adopt a customer-centric, "outside-in" mentality, designing their online banking experiences to anticipate the needs of the user while providing valuable tools and content to support their journey.

Many of the experiences we looked at offer little or no insight into a customer's financial condition and how certain actions, such as scheduling recurring money transfers, could affect account health. The OLB environment represents a perfect opportunity to provide contextual insight into how customers are managing their money and making day-to-day financial decisions, such as explicitly demonstrating for a user how scheduled bill-pay will affect their balance, helping to avoid overdraft or other penalties.

A good example is the basic “balance” element of OLB experiences. It’s typically stated as a single number, or as an end-of-day total on the statements/transactions page. However, why not show the user, next to that balance, a simple chart of the balance over the last 30 days? This would help a user see the pattern (typically a saw-tooth shape) and use this to factor into their decision making.

Why would a bank invest precious resources in something that people, frankly, have no choice but to use? Because like an appetizer before the entrée, online banking sets the stage for something much more substantial.

Banks make profits off of customers that grow in deposits and wallet-share, less so those with basic checking or savings accounts. It comes as no surprise that when a customer decides to shop around for a loan or credit product, their primary deposit/checking institution can miss out on a substantial opportunity in the form of a longer-term, profitable relationship.

Consider for a moment, if a person's primary deposit institution provided an online banking experience with which they were extremely comfortable using, and which proactively communicated with them about relevant financial products. Would the user be more likely to place additional trust in their chosen institution by opting for an added product that has already been recognized as meeting their need? We think the answer to that question is decidedly, "yes."

Providing an experience that meaningfully connects people with their money and provides sought-after, contextual advice offers banks a previously untapped opportunity to cross-sell customers and grow through a modern relationship-oriented approach.

This may sound like an idealistic yet logical direction to head in, but how can banks truly seize the opportunity to use this "appetizer" to develop deeper relationships with customers and grow their share-of-wallet? There must be a concerted effort to design and build an easy-to-use, highly-functional and insightful user experience that provides consistency as users move fluidly between digital touch points.

Based on our extensive work with clients from the financial services industry, and a thorough assessment of the current state of online banking, we've boiled down four core principles that should be embraced when designing a superior OLB experience:

Ensure exceptional ease-of-use by designing from the user's perspective to present information and structure interactions in a manner that is easily understood and managed.

Deliver a consistency of experience across device types by keeping the design aesthetic, content structure, and functionality the same across delivery channels to ensure that web, app, and mobile experience all work in a similar (but not identical) way.

Support good financial decision-making by offering valuable, contextual-based insight that can help people recognize which financial products and services could be beneficial to their situation.

Embrace a platform that can elegantly expand to house more features and functionality while moving up the value chain to deliver more products and services to customers.

We believe the banking industry is on the verge of a huge leap forward and that a tremendous opportunity exists in designing a better online banking experience. It starts with understanding what retail and commercial customers are looking for, and making a concerted effort to deliver a painless and fluid experience managing money. It ends with a customer experience that is differentiated from the rest, forges deeper connections across financial products and services, and empowers people to make better financial decisions.